Increased Monetary Thresholds Set in Latest Public Procurement Laws in Cyprus
In a significant move, the Plenary of the Parliament in Cyprus has approved two new laws to standardize financial thresholds for public contracts. These changes reflect the EU-wide revised thresholds that came into effect on 1st January 2018 and are in preparation for Cyprus' 2026 Presidency of the Council of the European Union.
The updated monetary thresholds for public contracts in Cyprus are as follows:
- €144,000 for public sector supply and service contracts, as well as design contests of central government authorities. - €221,000 for wider public sector supply and service contracts and service contracts that are more than 50% state-subsidised. - €443,000 for utility supply and service contracts, including service design contests. - €80,000 for small lots within projects exceeding the services threshold, limited to no more than 20% of the project value exempted from procurement rules.
These thresholds exclude VAT and represent an increase from previous values, implemented at the EU level to streamline procurement rules and align with economic changes. While the exact Cyprus-specific statutory thresholds may further adapt these EU directives, Cyprus, as an EU Member State, is governed by these EU thresholds as minimum standards.
The new laws also prohibit any payments from being made by the contracting authority before the legally required notifications are completed, offering greater flexibility to contracting authorities and entities to address inflationary pressures.
Moreover, the new legislation requires contracting authorities and entities to update the Electronic Public Procurement System (eProcurement System) to accommodate the changes in the financial thresholds for public contracts. This update is crucial in ensuring the smooth functioning of public procurement processes in light of Cyprus' upcoming assumption of the Presidency of the Council of the European Union during the first half of 2026.
The changes in the financial thresholds for works and supply contracts in Cyprus do not affect the limit for direct award contracts, which remains at €7,000. Interestingly, the limit for works and supply contracts with quotes from a limited number of economic operators, previously at €15,000, has been raised to €25,000, aligning with the existing threshold for service contracts. Similarly, the limit for works and supply contracts requiring offers from at least four economic operators, previously at €50,000, has increased to €80,000, matching the current limits for service contracts.
These reforms aim to enhance transparency, competitiveness, and strategic public expenditure management in Cyprus, as in other EU countries. As Cyprus moves towards its 2026 Presidency, these changes will help ensure that public procurement procedures remain harmonized across the EU.
- The financial thresholds for public contracts in Cyprus, aligned with EU-wide revised thresholds, will now include €144,000 for supply and service contracts of the public sector, €221,000 for wider service contracts and those over 50% state-subsidised, €443,000 for utility contracts, and €80,000 for small lots within projects, all excluding VAT.
- As an EU Member State, Cyprus is governed by minimum financial thresholds set by the European Union, with the new laws also mandating the update of the Electronic Public Procurement System (eProcurement System) to accommodate these changes.
- In addition to financial thresholds, the new legislation in Cyprus prohibits payments before legally required notifications and adjusts the limits for direct award and limited-quoted contracts, all serving to strengthen transparency, competitiveness, and strategic public expenditure management in preparation for Cyprus' 2026 Presidency of the Council of the European Union.
